Page 90 - How To Implement Lean Manufacturing

Lean Manufacturing Simplified 71

people are aware that something is abnormal and they usually have a specific protocol
to follow. This description of inventory management is focused on finished goods
inventories, but the concepts also apply to WIP inventories. Inventory volumes need to
be reviewed periodically to assess possible waste reduction opportunities. Remember,
any inventory beyond what is required to protect the supply to the customer, which is
the next operation, is unnecessary waste.
Cycle stock is to account for the inventory built up between customer pickups.
Buffer stock, on the other hand, is the inventory kept on hand to cover the varia-
tions associated with external causes, including demand changes and such items as
transportation variations. Any time this inventory is withdrawn, a note must be made
in the warehouse operating log, at a minimum; it is desirable to institute corrective
actions, as well. The warehouse log is a form of transparency.
Safety stock is that inventory kept on hand to cover the variations internal to the
plant, including line stoppages, raw material stock outs, and anything else internal that
hampers the ability to deliver the customer’s demands. Any time this inventory is with-
drawn, in addition to a note in the warehouse log, a corrective action report is initiated.
(See Chap. 3 for more on inventory.)

Chapter Summary
The heart of Lean is its philosophy of long-term growth generating value for the cus-
tomer, society, and the economy with the objectives of reducing costs, improving deliv-
ery times, and improving quality, all through the total elimination of waste. The key
foundational strategies that support this philosophy are the investment in people and
the stability of the processes that then yield a system that will produce a high-quality
product. On this foundation of high quality is built the strategy of quantity control. The
quantity control strategy is supported by two substrategies: jidoka and JIT. All of the
strategies and substrategies are supported by a broad range of tactics and skills.
Together we refer to the strategies, substrategies, tactics, and skills as the Tools of Lean.
In Chap. 20, we have included a House of Lean that shows how all the tools of Lean
work together to execute the objectives, which is simply “better, faster, cheaper,”
through the total elimination of waste.